PANAMSAT CORPORATION SEVERANCE PAY PLAN
(As Adopted Effective as of May 1, 1996)
SECTION 1
INTRODUCTION
1.1. Effective Date and Purpose. PanAmSat Corporation, a
Delaware corporation ("PanAmSat" or the "Employer"), has established the
PanAmSat Corporation Severance Pay Plan (the "Plan"), effective as of May 1,
1996 (the "Effective Date"). The purpose of the Plan is to provide severance pay
to eligible employees of PanAmSat upon separation of employment.
1.2. Funding Medium. All benefits payable under the Plan shall
be paid solely from the general assets of PanAmSat. No Participant shall have
any right to payment of benefits greater than that of a general creditor of
PanAmSat.
1.3. Plan Administration. PanAmSat is the Administrator of the
Plan. PanAmSat, through its Chief Executive Officer, Executive Vice President,
Chief Financial Officer or General Counsel, has the authority to interpret,
control and manage the operation and administration of the Plan as set forth
herein.
1.4. Plan Year. The Plan Year of the Plan shall be the
calendar year.
SECTION 2
PLAN PARTICIPATION
2.1. Eligibility for Participation. Subject to the conditions
and limitations of the Plan, each employee of PanAmSat employed on a regular
full-time basis shall become a Participant in the Plan as of the Effective Date
of the Plan, or on any subsequent date on which such employee first becomes a
regular full-time employee of PanAmSat.
2.2. Termination of Participation. Subject to the conditions
and limitations of the Plan, an individual shall not be a Participant during any
period that the individual is not an employee of PanAmSat.
2.3. No Employment Guarantee. The Plan does not constitute a
contract of employment and participation in the Plan does not and will not give
any individual the right to be retained in the employ of PanAmSat, or any right
or claim to any benefit under the Plan, unless and except to the extent that
such right or claim is specifically provided for under the terms of the Plan.
SECTION 3
SEVERANCE BENEFITS
3.1. Eligibility for Severance Benefit. A Terminated Employee
(as defined herein) shall be entitled to receive from the Employer the Severance
Benefit described in Subsection 3.2. For purposes of the Plan, a "Terminated
Employee" is an employee whose employment with PanAmSat is terminated by the
Employer other than for Cause (as defined in Subsection 3.3). An employee who
resigns from the employ of PanAmSat or who is on a leave of absence from the
Employer shall not be considered a Terminated Employee.
3.2. Amount of Severance Benefit. The Severance Benefit to be
paid to a Terminated Employee shall be paid by PanAmSat as soon as practicable
after the termination, in the form of a single lump sum payment, less applicable
deductions and withholdings, in an amount calculated as follows:
Employee's Continuous Years of Service Amount of Severance Pay
- -------------------------------------- ---------------------------------
One year but less than five years One week's compensation for every
year of service
Five or more years Five weeks' compensation plus two
weeks' compensation for every
year of service above five years
with maximum and minimum severance benefit payment of:
Minimum Maximum
Executive Employee 4 weeks 52 weeks
Exempt Employee 3 weeks 29 weeks
Non-exempt Employee 2 weeks 29 weeks
For purposes for the above schedule, a Terminated Employee's "Years of
Continuous Service" shall be the number of whole years elapsed during his or her
most recent period of continuous full-time employment. The "week's compensation"
of a Terminated Employee shall be his or her regular weekly gross rate of
compensation. If a Terminated Employee was paid on an hourly basis, then his or
her regular weekly gross rate of compensation shall be equal to the product of
his or her regular hourly rate of compensation on the date of the termination of
employment, multiplied by the number of regularly scheduled weekly hours of
work. If a Terminated Employee was salaried, his or her regular weekly rate
shall be the gross weekly compensation. If a Terminated Employee was a
commissioned salesman, then the regular weekly rate of compensation shall be
equal to the quotient of his or her gross compensation paid in the twelve-month
period ending on the date of the termination of employment divided by fifty-two
(52).
3.3. Cause Defined. For purposes of this Section 3, an
employee shall be considered to have been terminated for "Cause" if he or she is
discharged for theft or other misconduct, negligence, drug or alcohol abuse,
commission of a crime, failure to follow the instructions of a supervisor, or
other violation of the written or oral employment policies of the Employer.
SECTION 4
ADMINISTRATION OF THE PLAN
4.1.Authority. The Chief Executive Officer, or his or her
designee, has the power to determine all questions arising under the Plan,
including the power to determine the rights or eligibility of employees or
participants and their beneficiaries and their respective benefits, and to
remedy ambiguities, inconsistencies or omissions.
4.2. Decision Final. To the extent permitted by law, any
interpretation of the Plan and any decision on any matter within the discretion
of the Chief Executive Officer made by the Chief Executive Officer in good faith
will be binding on all persons. A misstatement or other mistake of fact shall be
corrected when it becomes known, and the Chief Executive Officer shall make such
adjustment on account thereof as he or she considers equitable and practicable.
SECTION 5
CLAIMS PROCEDURE
5.1. Initial Claim and Decision. A Terminated Employee or his
or her beneficiary (or his or her authorized representative) may file a written
claim for any benefits to which the employee believes he or she is entitled
under the Plan. The Chief Executive Officer will provide the claimant with
written notice of his or her decision on a claim within 30 days after receipt of
the written claim, unless special circumstances require an extension of time.
The Chief Executive Officer will provide the claimant with written notice of any
extension before the end of the initial 30 day period which will indicate the
special circumstances requiring the extension and the expected decision date,
which may not be more than 60 days after receipt of a written claim. If any
claim is wholly or partially denied, then the written notice of the decision
will inform the claimant of:
(a) the specific reasons for the denial;
(b) the specific provisions of the Plan upon which the denial is
based;
(c) any additional material or information necessary to perfect
the claim and reasons why such material or information is
necessary; and
(d) the right to request review of the denial and how to request
such review.
If written notice of the decision is not given to the claimant within the
period, including extensions, prescribed above in this Subsection 5.1, then the
claim shall be deemed denied for purposes of the claimant's right to request a
review of the denial pursuant to Subsection 5.2.
5.2. Request For Review of Denied Claim. The claimant or his
or her authorized representative may request review of the denial of a claim
within 60 days after receipt of written notice of the denial of all or a portion
of the claim by writing filed with the Chief Executive Officer. Written issues
and comments may be submitted to the Chief Executive Officer along with the
review request. During the 60 day period following notice of the denial, the
claimant or his or her authorized representative may examine the Plan and any
other document upon which the denial is based.
5.3. Review of Denied Claim. Upon receipt of a request to
review its denial of a claim, the Chief Executive Officer shall undertake a full
and fair review of the denial and, except as provided below, provide the
claimant with written notice of its decision within 10 days after receipt of the
review request unless special circumstances require an extension of time. The
Chief Executive Officer will provide the claimant with written notice of any
extension before the end of the regular review period which will indicate the
special circumstances requiring the extension and the expected decision date,
which may not be more than 20 days after receipt of a review request. The
written notice of the decision shall inform the claimant of the specific reasons
for the decision and the specific provisions of the Plan upon which the decision
is based. If written notice of the decision is not given to the claimant within
the period, including extensions, prescribed above in this Subsection 5.3, then
the claim shall be deemed denied on review. Except as may be otherwise required
by law, the decision of the Chief Executive Officer on review of the denial
shall be conclusive and binding on all parties.
SECTION 6
GENERAL PROVISIONS
6.1. Reemployment of Participant. If the employment of an
employee with the Employer terminates and the employee is subsequently
reemployeed by PanAmSat, then he or she shall be treated as a new employee for
all purposes of the Plan.
6.2. Death of Participant. If a Terminated Employee dies
before receipt of any amount otherwise payable to him under the Plan, then that
amount shall be paid to his or her "Beneficiary", which shall be the employee's
estate
6.3. Benefits May Not Be Assigned or Alienated. The benefits
payable to any person under the Plan may not be voluntarily or involuntarily
assigned or alienated.
6.4. Binding on Successors. The provisions of the Plan shall
be binding upon and shall inure to the benefit of PanAmSat, and the
participants, and their respective successors in interest and assigns. Except as
may otherwise be determined by a resolution of the Board of Directors of
PanAmSat, PanAmSat shall require any person or entity that becomes a "successor
in interest" (as defined below) to PanAmSat to expressly assume the Plan and
agree to perform all of obligations of PanAmSat under the Plan. For purposes of
this Subsection 6.4, a "successor in interest" to PanAmSat shall include any
person or entity (or group of related or affiliated persons or entities) that
acquires (in a single transaction or a series or related transactions) any
businesses or assets of PanAmSat representing twenty-five percent (25%) or more
of PanAmSat's sales, operating profits, or operating assets.
6.5. Gender and Number. Where the context admits, words in any
gender shall include any other gender, words in the singular shall include the
plural, and words in the plural shall include the singular.
6.6. Governing Law. The Plan shall be construed and
administered according to the internal laws and court decisions of the State of
New York to the extent that such laws are not preempted by the laws of the
United States of America.
6.7. Participant Elections and Notices. Any election or notice
required or permitted to be made by a participant under the Plan must be made in
writing and filed with the Chief Executive Officer at such time and in such form
as the Chief Executive Officer requires, except as otherwise specifically
provided in the Plan. Any election, notice, or other document required to be
filed with the Chief Executive Officer shall be properly filed if delivered or
if mailed postage prepaid by certified mail, return receipt requested, to the
attention of the Chief Executive Officer, at the business address of PanAmSat's
office headquarters. Any notice required under the Plan may be waived by the
person entitled to such notice.
SECTION 7
AMENDMENT AND TERMINATION
7.1. Amendment and Termination. Subject to the provisions of
Subsection 7.2, PanAmSat, through its Board of Directors, reserves the right to
amend the Plan from time to time and reserves the right to terminate the Plan at
any time without prior notice.
7.2. Limitations on Amendment and Termination. Notwithstanding
the provisions of Subsection 7.1, except as may otherwise be determined by a
resolution of the Board of Directors of PanAmSat, the Plan shall not be
terminated with respect to any Terminated Employee (or their Beneficiaries) and
no amendment shall be made to the Plan that is adverse to the interests of any
Terminated Employee (or their Beneficiaries). In no event may this Plan be
modified or terminated following a "Material Change" as defined in Section 3.5
of PanAmSat's Involuntary Separation Pay Plan with respect to employees of
PanAmSat at the time of the occurrence of such "Material Change."
IN WITNESS WHEREOF, the President and Chief Executive Officer
of PanAmSat has executed this Plan, as of the Effective Date, to evidence his
approval of the provisions of the Plan.
PANAMSAT CORPORATION
By:
President and Chief Executive Officer
ATTEST:
Its Secretary